1997 (5) TMI 149 - AT - Customs

Summary

Issues:
Classification of imported Agitation System under CTH 8479.82, claim of exemption under Notification No. 59/87, appeal against the order of Collector (Appeals) by the Revenue.

Analysis:
The case involves the classification of an imported Agitation System under CTH 8479.82 and the claim of exemption under Notification No. 59/87. The respondents imported the system comprising of Agitators and claimed exemption under Notification No. 59/87, which was initially rejected by the Assistant Collector but later allowed under Notification No. 162/89. The Collector (Appeals) accepted the claim for exemption under Notification No. 59/87, leading to the Revenue appealing against this decision.

The Agitation System in question is a composite machine used in the manufacturing process of Styrene Monomer, which is then polymerized to produce Polystyrene. The system includes various components like a drive, variable speed drive, hydraulic power pack, gear box, mixer shaft, and impeller. The purpose of the Agitator system is to agitate and mix the reactant, control the molecular weight of the product, and facilitate the polymerization process.

The main contention in the case revolves around the eligibility of the respondents for exemption under Sl. No. 50 of Notification No. 59/87, which covers machinery used for the production of a commodity. The learned Advocate for the respondents argued that the Agitation System falls under this category based on previous judgments and cited examples like Project & Development India Ltd. v. Collector of Customs. The Notification specifically includes machinery used for the production of a commodity under certain sub-headings, even though sub-heading 8479.82 is not explicitly mentioned.

The Tribunal, after considering the manufacturing process and previous orders, concluded that the Agitation System qualifies as machinery used for the production of a commodity. Since such machinery is listed under Sl. No. 50 of the exemption Notification No. 59/87, the respondents are entitled to the exemption. Therefore, the Revenue's appeal was rejected, and the impugned order of the Collector (Appeals) was upheld.

In summary, the judgment clarifies the classification of the Agitation System, the eligibility for exemption under Notification No. 59/87 based on the machinery used for the production of a commodity, and the decision to reject the Revenue's appeal in favor of the respondents.